United States District Court, D. Colorado
ORDER DENYING A STAY OF EXECUTION OF
JUDGMENT
CHRISTINE M. ARGU LLO UNITED STATES DISTRICT JUDGE
This
matter is before the Court on Defendant Integrity Solutions
Group, Inc.'s Second Renewed Motion to Stay Execution of
Judgment. (Doc. # 272.) The Court denies Defendant's
Motion for the reasons detailed below.
I.
BACKGROUND
United
States Magistrate Judge Scott T. Varholak detailed the
factual background of this matter in his Recommendation on
the Motion to Dismiss, issued March 14, 2017. (Doc. # 61.)
The Recommendation is incorporated herein by reference.
See 28 U.S.C. § 636(b)(1)(A); Fed.R.Civ.P.
72(a). The Court will detail only the subsequent procedural
history relevant to the Motion now before it.
As the
Court explained in its Order Denying Defendant's First
Renewed Motion to Stay Execution of Judgment (Doc. # 256), a
four-day jury trial on Plaintiff Live Face on Web, LLC's
copyright infringement claim resulted in the jury awarding
Plaintiff $262, 197.00 in actual damages. See (Doc.
# 216.) On October 5, 2018, the Clerk of the Court entered
judgment in that amount, plus post-judgment interest, in
Plaintiff's favor (the “Judgment”). (Doc. #
218.)
On
October 22, 2018, Plaintiff began executing the Judgment by
applying for and receiving several writs of garnishment
directed to Defendant's vendors and customers. (Doc. ##
228-39.) Defendant filed its First Renewed Motion to Stay
Execution of Judgment on the following day, October 23, 2018,
and requested that the Court stay execution of the Judgment
pursuant to Federal Rule of Civil Procedure 62(b) until the
Court ruled on Defendant's then-forthcoming post-trial
motions. (Doc. # 244.) Defendant stated that it did not have
the resources to post a bond. (Id. at 5.) Plaintiff
responded in opposition to Plaintiff's request on October
24, 2018 (Doc. # 249), to which Defendant replied on October
29, 2018 (Doc. # 255).
The
Court denied Defendant's First Renewed Motion to Stay
Execution of Judgment on October 30, 2018. (Doc. # 256.) It
concluded that it could not grant Defendant's request to
stay execution of the Judgment because Defendant was
unwilling to meet any “appropriate terms for the
opposing party's security” as required by Rule
62(b). (Id. at 5-6); Fed.R.Civ.P. 62(b). Having
reached that conclusion, the Court declined to address the
four factors bearing on whether a stay of execution of
judgment is warranted. (Doc. # 256 at 6.)
Also on
October 30, 2018, Plaintiff filed applications for and the
Clerk of the Grant issued writs of garnishment directed at
Defendant's counsel, the Schneider Rothman IP Law Group
and the T. Walsh Law Firm, Ltd. (Doc. ## 257-58, 261-62.) The
Schneider Rothman IP Law Group answered on November 13, 2018,
stating that it did not possess or control any personal
property of Defendant, the judgment debtor, and did not owe
any rents, payments, obligations, debts, or money to
Defendant. (Doc. # 290.) The T. Walsh Law Firm answered on
November 13, 2018 as well, but it stated that it possessed
$22, 149.72 in “client retainer funds held in
firm's COLTAF account.” (Doc. # 286 at 2.)
Defendant
filed its Second Renewed Motion for Stay of Execution of
Judgment on November 2, 2018. (Doc. # 272.) In response to
the Court's statement that Rule 62(b) plainly requires
the party requesting a stay to post a security, Defendant
proffers:
As of the date and time of service of the Writ of Garnishment
[to the T. Walsh Law Firm] by Plaintiff, [the T. Walsh Law
Firm] holds the sum of $22, 149.72 in its client trust
account on behalf of [Defendant.] . . . Defendant requests
that [it] be permitted to instruct its counsel to deposit
$22, 149.72[, ] to be deposited onto the Court's
registry[, ] to serve as a security to support the present
Motion.
(Id. at 2.) Defendant also argues that a stay is
appropriate under the four relevant factors because: (1) its
contemporaneously-filed motions for post-judgment relief,
see (Doc. ## 270-71, 284-85), make a strong showing
that it is likely to succeed on the merits; (2) Defendant
“continues to incur costs and [sic] related to this
trial;” (3) the “deposit of these funds into the
Court's registry . . . would not substantially injure the
Plaintiff;” and (4) the “public interest supports
a party such as allowing Integrity [sic] a brief respite from
the aggressive post-judgment actions of the Plaintiff in
order to put forth its post-judgment motions” and
conduct other post-trial work. (Doc. # 272 at 3-4.)
Plaintiff
responded in opposition to Defendant's renewed request
for a stay on November 6, 2018. (Doc. # 275.) Plaintiff first
argues that Defendant's proposal to deposit the $22,
149.72 sum held by the T. Walsh Law Firm in its client trust
account on Defendant's behalf “is no offer of
security at all” because those funds “have been
properly garnished-frozen-and the Defendant has no right to
direct what happens to those funds.” (Id. at
2.) Plaintiff also asserts that Defendant has “not
objectively shown it cannot afford to provide [Plaintiff]
security in the full amount of judgment.”
(Id.) Finally, turning to the four factors bearing
on a stay pursuant to Rule 62(b), Plaintiff argues that
Defendant fails to make a strong showing that it will prevail
in its post-trial motions because Defendant's positions
in those motions are “simply a rehash of theories
considered and rejected by this Court and the Jury” or
“were waived by virtue of a failure to raise them at
trial pursuant to Rule 50(a).” (Id. at 5.)
Defendant
filed its Reply on November 10, 2018. (Doc. # 283.) It rebuts
each of Plaintiff's arguments, asserting that “the
amount pledged functions as a security under Rule 62, ”
that Plaintiff “possess[es] objective evidence of
Defendant's decline in revenues, ” and that
Defendant “meets its burden under the four Rule 62
factors.” (Id. at 2-4.)
II.
APPLICABLE ...